UK Security for Expenses Scheme

The UK Security for Expenses Scheme is a free-to-use scheme for the protection of security for expenses under s.12 of the Party Wall etc. Act 1996.

Under s.12, the party wall surveyors representing the Adjoining Owners (the neighbours of the owners who are planning to carry out works) can require, as part of the drafting of the Party Wall Award, the Building Owner to make a deposit into escrow of an agreed amount of money. This is called "Security for Expenses".

Historically, the Building Owner would need to deposit this either with one of the party wall surveyors or with a third-party escrow agent.  This often involved a lot of form-filling, and not-insignificant cost (calculated as a percentage of the amount being held).

We launched this scheme in order to revolutionise the way in which security for expenses are held. We've removed all the friction (through our state of the art Security for Expenses Portal), and we've removed all the cost (because this is not our primary service, and we are able to cover all of our overheads from our other escrow and third-party managed payment services.

We work with all kinds of Building Owners, from individuals who are carrying out minor works, to institutional landlords who own and manage enormous real estate porftolios.

Owing to our long-standing high-value international escrow expertise, we are comfortable working with corporate clients, overseas clients and trusts, and we don't apply any surcharges for working with these kinds of clients.

All you need, to be able to deposit your security for expenses, is a Party Wall Award requiring you to do so.

The UK Security for Expenses Scheme is used when Building Owners are required to deposit security for expenses under their Party Wall Award, and want a fast, frictionless, secure way to do so.

We started the UK Security for Expenses Scheme because we had so much interest in our party wall escrow services from Building Owners who were:

• were shocked at the significant cost of this service from those who were offering it (especially as the Party Wall etc. Act 1996 compels the security to be deposited);
• were frustrated with bureaucracy in administering the account opening or release of their funds;
• had their affairs structured through a trust, company or overseas entity; or
• simply wanted to deposit their security for expenses from a bank account overseas.

All of these scenarios either led to delays, or increased fees in administering their security.

Subject to our firm-wide Restricted Activities and Restricted Jurisdictions, we are able to hold security for expenses, free of charge, for anyone with a Party Wall Award.

The benefits of using the UK Security for Expenses Scheme are many. We're disrupting the old ways and offering Building Owners greater choice and value when it comes to holding their security. A short summary of some of the benefits is shown here:

Our security for expenses deposit accounts are very straightforward. For every Party Wall Award, we open the Building Owner a new account, with its own unique sort code and account number combination, in their name, for them to deposit the security into.

All of the surveyors involved can see the account, and the deposits and withdrawals that have been made, at any time, 24/7 through the Security for Expenses Portal.

If the Building Owner has three simultaneous awards because they have three simultaneous party wall awards on the same building, all with different Adjoining Owner Surveyors and Third Surveyors, that's no problem at all. Each award has its own access permissions, and only those who have access can see the information.

While it is very common for Party Wall Awards to mandate a phased/staged release of funds (which we offer at no additional cost), that is the limit of the tailoring that we are able to offer under the free-to-use scheme.

We can, of course, provide bespoke party wall escrow (which was one of our very earliest escrow services), and you can Request a Quote here for your exact requirements.

The primary method of administering your account is through our online Security for Expenses Portal. There, you can create and update your building portfolio, upload your Party Wall Award and submit your compliance information.

This portal provides a single place where authorised parties can view account balances, payment history and security status.

Using a digital portal reduces reliance on email chains and manual reconciliation. It improves transparency and creates a clear audit trail for payments and releases. Surveyors often find this helpful when reviewing payment history or responding to queries during the life of the project.

The Security for Expenses Portal also supports the community of expert party wall surveyors who have come to rely on using the UK Security for Expenses Scheme.

We've simplified the administration of party wall security for expenses by collating all of your clients, their buildings and your active party wall awards into an easy-to-use, centralised portal.

You can start the account opening process for your clients; verify the deposit of security (either as the Building Owner's Surveyor or as the Adjoining Owner's, or even as a Joint or Third Surveyor); and market your firm through our directory or submitting guest blog posts.

Unless you have ever had to deal with a Party Wall Award before, it is likely you have never come across security for expenses. Their genesis lies in s.12 of the Party Wall etc. Act 1996, which says that an Adjoining Owner may require a Building Owner to 'give security' as part of the party wall arrangements.

The GOV.UK guidance note explains it a little further:

If there is a risk that you will be left in difficulties if the Building Owner stops work at an inconvenient stage, you can request them, before they start the notified work, to make available such security as is agreed (or, if not agreed, determined by the surveyors), which may be money or a bond, or insurances.

The money remains the Building Owner’s throughout, but if, for example, you need to have a wall rebuilt, you, or more commonly the surveyors, can draw on that security to pay for the rebuilding.

While the guidance lists bonds and insurances, and for a while during the early 2000's it was possible to get such insurances, as far as we know they aren't available on the market at present.

The Party Wall Award itself will set out how much you need to deposit, in a clause that will often look a bit like this:

A total sum of £[amount] (the 'Security Sum') shall be held in the UK Security for Expenses Scheme (the 'Security Account'). The Security Sum is intended to cover the potential expense to the Adjoining Owner if the works were to stop prior to [...].

That clause will set out the amount, and the conditions for it being released. It will also usually go on to explain when the sum needs to be deposited (often before certain disruptive works begin), and how and when it can be released (often, ins tages as the most risky/intrusive work is completed).

We simply work to the terms of the Party Wall Award, and release the funds once the surveyors give consent.

The account is governed by the Scheme Rules. If there is any inconsistency between the Scheme Rules and the terms of the Party Wall Award (which is very unlikely, because surveyors don't really concern themselves with how we run our accounts), the Scheme Rules will apply.

For all other matters, however, the Party Wall Award takes precedence - we simply do what the Party Wall Award, and the Party Wall etc. Act 1996, require.

We can accept instructions from the Building Owner, the Adjoining Owner, and the surveyors representing them. Sometimes, the Building Owner and Adjoining Owner will have a surveyor each, and they'll also appoint a Third Surveyor to get involved in the case of any disputes. Other times (often for smaller works) the Building Owner and Adjoining Owner will jointly appoint a surveyor to act for both of them in drawing up and administering the Party Wall Award.

Requests for release are usually tied to specific events, such as the issue of a certificate, confirmation of a milestone or the occurrence of a default. We'll liaise with the surveyor(s) and/or the building/adjoining owners to make sure everyone is comfortable and satisfied before we release the security.

This approach ensures that payments are controlled, predictable and not dependent on informal requests or unilateral decisions by one party.

Navigate to the Security for Expenses Portal, sign up, create a building and upload your Party Wall Award.

If we haven't worked with the Building Owner before, we'll need to take them through our quick compliance steps (we are opening a bank account in their name, after all), but our systems make this both efficient and quick.

We've also got some helpful walkthroughs to show you exactly what you need to do at each stage:

1. Open the Security for Expenses Portal
2. Create your building if it doesn't already exist
3. Upload your Party Wall Award
4. Provide your compliance information
5. Get your unique bank account details
6. Deposit your security

The limiting factor, when opening an account, is usually the speed at which you are able to provide us with the compliance information.

Once that is provided, we are usually able to open the account and accept your security on the same working day.

We carry out compliance checks on the owner(s) of the building, and whoever is transferring us the security sum.

If they are individuals, we simply need a copy of their valid passport, driving licence or national identity card (with photo), and a recent bank statement or utility bill to confirm their address. We need an email address for each one, and they will receive a personalised link to upload that information.

Where one of those parties is a corporate entity, we also need some details of the corporate entity, its corporate structure, and the individuals' information for each director and 25%+ shareholder.

To get started, you'll need:

• A copy of your Party Wall Award (this can be in draft, but we will need the final signed version)
• Details of the corporate structure of the building owner (if any)
• Photo ID, proof of address and a bank statement dated within the last three months for the entity/person depositing the security.

Funds paid into one of our security for expenses accounts are held separately from the money of the Building Owner/Adjoining Owner and separately from our own funds. They are not mixed with operational accounts.

All of our escrow funds are ultimately held liquid and unencumbered at the Bank of England. This means that there is no counterparty risk (the bank does not lend out funds, so a 'run on the bank' is not possible).

The account is set up specifically for the holding of security under a Party Wall Award. Funds can only be used in line with that agreement and cannot be applied for any other purpose - at the end of that purpose, they are returned to where they were deposited from.

They remain ring-fenced for the project until they are released in accordance with the agreed conditions.

We are regulated by the Financial Conduct Authority for the provision of payment services. This means we are required to meet regulatory standards around governance, systems, controls and the handling of client funds.

Where escrow arrangements involve regulated payment activity, those activities are carried out within that regulatory framework. Other aspects of escrow are contractual in nature and governed by the agreement between us and the parties.

In practical terms, this combination of regulation and contract provides structure and oversight, while still allowing escrow arrangements to be tailored to the needs of a specific matter or project.

Our security accounts are designed to hold, protect and release funds in line with the provisions of the Party Wall Award. We do not decide who is right or wrong in a dispute.

We do not interpret the underlying Party Wall Award, assess the quality of anything done on site or carried out under that underlying Party Wall Award, or replace the role of a surveyor, contract administrator, adjudicator or court. If there is a dispute, the funds remain held while the parties follow the agreed dispute resolution process.

The use of our accounts does not remove the need for a properly drafted underlying Party Wall Award. It supports that Party Wall Award by providing a clear and neutral deposit holding mechanism, but it does not change the parties’ underlying rights or obligations.

As you will note from our Security for Expenses Scheme Pricing page, there is no charge for the opening or administration of an account, for receiving or returning any security, or for paying it to the Adjoining Owner or as agreed between the parties and their surveyors.

The only time we have reserved the right to charge a fee is if we are drawn into a dispute between the parties - and this is simply because it will take up a lot of our time.

In practice, however, this has never been relied upon. We're not even sure that it is likely that it could be called upon, because our only involvement would be to confirm or deny that certain funds had been deposited or released on certain dates, which the parties can do themselves on the Security for Expenses Portal in any event.

Underlying the whole party wall security for expenses regime is the Party Wall etc. Act 1996. This outlines what must be done in the event of a dispute or something going wrong in respect of the works or the Party Wall Award.

If there is a mistake, delay or disagreement about releases, funds remain safely held in escrow while the issue is addressed. We do not release funds unless and until the parties agree, or we are directed to by the Third Surveyor or a court.

If a party has a concern about how the escrow account is being operated, we have a formal complaints process. This allows issues to be raised, reviewed and resolved in a structured way, with escalation routes available if needed.

We are a specialist provider focused on escrow and managed payment arrangements. Escrow is not an add-on to another service. It is a core part of what we do.

Escrow funds are held securely and separately, with infrastructure designed specifically for escrow rather than adapted from other uses. Account opening is handled efficiently, and escrow arrangements are administered through a dedicated digital escrow portal, giving authorised parties visibility and a clear audit trail.

Advisors often recommend us because we sit independently of the transaction, operate within a regulated framework, have a proven track record and focus on doing one thing well: Holding and administering escrow funds in a clear, neutral and predictable way.

We launched this scheme in late 2024 and have enjoyed significant growth since.  A handful of our reviews are shown here for example: